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"Birds of a feather, flock together." If all goes well, BofA will own up to 19.9% of China Construction Bank (CCB) by the end of 2005. Funding for the deal starts at $2.5 billion (for the first 9%) and goes up from there. Given the systemic corruption at CCB -- it's lost two chairmen of the board in the last five years -- we can expect lots of future stories on this marriage.
The Wall Street Journal reported on June 17, 2005, that Bank of America will
pay $2.5 billion to purchase a 9% stake in China Construction Bank (CCB). It
has options to increase its holdings to 19.9% by purchasing shares at the same
price as the IPO.
CCB is the third largest bank in China and is state-owned. It hopes to sell
its shares publicly (IPO) for the first time, sometime during 2005. BofA will
invest another $500 million at the time of the IPO in order to maintain its
percentage of ownership. By contrast, BofA is the second-largest U.S. bank.
{sidebar id=1}The odd 19.9% ownership is not incidental -- it's the maximum allowed by the
Chinese government.
The agreement will be signed in Beijing by Bank of America Chairman Kenneth
Lewis and China Construction Bank Chairman Guo Shuqing.
Bank of America is a major globalist bank. At the time of the founding of the
Trilateral Commission, the chairman of BofA was Alden W. Clausen. Clausen was
a member of the TC for many years, and became president of the World Bank in
1981.
One can be assured that BofA will direct financing to globalist companies involved
in building China into an economic superpower.
This story is interesting from another perspective.
Business in China is notoriously corrupt. Not too much of this hits the overseas
press because of strong Chinese censorship.
The Economist (London) reported in March (2005) that the then-chairman of CCB,
Zhang Enzhao, resigned for "personal reasons". It turns out that Zhang
is charged in a U.S. civil suit of accepting a $1 million bribe from Alltel
Information Services (AIS). The suit was prompted by a "partner" of
Alltel, Grace & Digital Information Technology, a Beijing consulting firm.
According to the Economist,
"Mr Zhang's accuser was Grace & Digital Information Technology,
a Beijing consulting firm. Grace says it was cheated out of $58.7m in commissions
on two software contracts, worth $176m combined, that AIS won from CCB in
2001 with Grace's help. When the American firm played host to Mr Zhang in
California, they drew up new contracts and, the complaint alleges, “colluded”
to exclude Grace.
"In his response, also seen by The Economist, Mr Wilson [executive
at Alltel] calls the bribery charges “completely false”. He
claims that AIS won only $3.3m in contracts with Grace's help. When CCB's
former boss, Wang Xuebing, was investigated for graft (he was replaced by
Mr Zhang in January 2002 and is now in jail), the bank froze its contracts
with AIS. Grace's bosses, according to Mr Wilson, fled China and did nothing
to help AIS pursue other business with CCB. A letter shows that AIS gave
notice to terminate its contract with Grace in March 2002—a year and
a half, Mr Wilson says, before AIS struck new contracts with CCB. Mr Wilson
claims that language barriers meant 'business was not discussed during the
golf outing'."
Do you get the impression that this is the SECOND tangle that AIS has had with
corruption involving the same bank?
Apparently Bank of America's management and board don't seem to mind being
involved with this stuff. Maybe they figure that the "third time's the
charm" in that after two corrupt bank chairmen, maybe the third one will
turn out OK.
On the other hand, remember that globalists have NEVER had qualms about dealing
with the worst of governments for the sake of profit. There is a long history
of Wall Street money flowing to marxist/communist countries around the world.
In this current instance, we may have an application for "Birds of a feather,
flock together."
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